Defence Accounts Department( DAD) is responsible
for audit, payment and
accounting of all Receipts and charges pertaining to Defence Services
and Defence Organizations.

Compilation
Work in DAD offices

The accounting information in DAD are classified into various
accounting heads as given in the List of Major and Minor Head of
Account (LMMH) published by Controller General of Accounts.

The last element of accounting classification in DAD is in the form of
code heads. The code-heads are unique identification for accounting
transaction which are given by DAD.

The accounting code-heads operated by DAD in respect of Defence
Organisations are contained in Classification Hand Book- Defence
Services Receipts and Charges (CHB) and code heads other than Defence
budget relating to DAD, CGO, BRO, CSD, MOD(Sectt) and Public Account
and Contingency Fund of India are contained in Pamphlet of Revenue,
Debt and Remittance Heads (RD & R Pamphlet).

Five
tier
classification of Defence expenditure.

Compared to six tier classification followed in Civil departments,
where the object head is the sixth tier of classification, DAD follows
5 tier classification with last tier classification- detailed head-
treated as object head.

Sectors

Major Heads (Sub-Major Head in case of Capital Outlay)

Minor Heads

Sub-Heads

Detailed Heads

The codification pattern for detailed code heads under each Minor Head
of CHB and R D & R Pamphlet. consists of 7 digits. The first two
digits denote category prefix, the next three digits denote the main
part of the code head and the last two digit denote suffix to the main
code head. There are about 1800 code heads in use in CHB and 900
code heads in R D & R Pamphlet.

Punching
Medium and its elements

The basic document that goes into the compilation of accounts is called
the Punching Medium(PM). It is the most elementary document prepared in
the DAD offices that goes into the preparation of the accounts
for the Defence Services. It contains information relating to
Month, CDA(code) booking the transaction, classification code head,
class of voucher, serial number of the voucher, whether a Receipt
or a charge and the amount.

The various class of vouchers and the respective code numbers assigned
to them are as under:

The present Financial information System revolves round Distributed
Data Processing (DDP) centers located all over the country, co-located
with Controller offices and in the CGDA EDP Centre. The PM are
forwarded by CsDA offices to DDP Centres for data entry and
processing and onward transmission to CGDA, EDP Centre for final
compilation. The following compilation reports are generated for
distribution to various authorities at MOD, Service Head Quarters and
CGDA.

1.All India Printed compilation

2. Consolidated RDR

3. Analysis

4. command –wise Report

5. Directorate-wise Report

6. Charged Expenditure Report

7. Fictitious Head Report

8. Category 13 and 16 Report

Adjustment
of 0/020/80 (MROs)

Cash tendered by an officer of the Defence Services to banks/treasury
shall be accompanied by a Military Receivable Order (MRO) in
triplicate. The original copy will be delivered to the tenderer and the
duplicate sent to CDA concerned by the bank/treasury through the Focal
Point Branch. The triplicate will also be returned to the depositor.

While the Original copies of MROs sent by the depositor will be
received in Audit Section, the Duplicate copies of MROs(DMROs) along
with Credit Scrolls/ Schedule of Receipts will be received in Accounts
Section. Since DMROs are received faster from banks , its
adjustment preceeds adjustment of OMROs. The adjustments by Accounts
Section and Audit section are carried out as under:

While a closing balance of (+) Charge to 0/020/80 represents adjustment
of OMROs for which adjustment of DMROs are yet to be carried out by
Accounts Section, whereas closing balance of (-) Charge to 0/020/80
represents adjustment of DMROs by Accounts Section for which adjustment
of OMROs are yet to be carried out by Audit Section.

At the end of the year, amounts for which credit scrolls/MROs or
RBI advice has not been received, the unadjusted amount is
transferred as (+) Receipt to 0/020/83-‘RBI suspense unclassified’. On
receipt of credit scrolls/ MROs or RBI advice, 0/020/83 and
0/020/80 are relieved by (-) Receipt and (-)Charge respectively. With
the introduction of Focal Point Branch System, a new suspense head
known as “PSB suspense” has been opened under code head 0/020/76 to
identify the wanting scrolls and advices relating to Public Sector
Banks(PSB). However the procedure for its booking and clearance remains
the same as applicable to 0/020/83.

Adjustment
of 0/020/81 (Cheques & Bills)

All payments on behalf of Defence Services are either made at a
treasury or the bank by means of cheque etc drawn by officers of the
Defence Accounts Department and in certain cases by officers of Defense
Services. Each dealing branch of SBI and Associate bank will furnish to
the Focal point branch(FPB) daily scrolls supported by paid
cheques/MROs. The dealing branches of RBI will act as FPB and send
their main scroll direct to CDA concerned. The Focal point Branch of
SBI will prepare Main Scrolls based on the daily scrolls received from
dealing branches and send them daily to CDA duly supported by paid
cheques/MROs. However this procedure is not applicable in respect of
pension transactions, where scrolls are sent direct to PCDA, Allahabad
by the SBI branches.

The daily scrolls will be received in the Accounts Section of the
CDA’s office and after agreeing with the monthly DMS total and total
reflected by RBI,CAS Nagpur, paid cheques/MROs are handed over to staff
for linking and pairing with schedule III. The adjustment carried out
by Audit section while issuing cheque and by Accounts section while
carrying out adjustment on receipt of debit scrolls/ paid cheques are
as follows.

Audit
Section- while issuing
cheques

0/020/81 (Cheques & Bills)
(+)Receipt Service Head (+)
Charge

Accounts
section- while
adjusting debit scrolls/paid cheques

0/020/81 (-)
Receipt
0/021/00 (RB deposits) (+) Receipt

At the end of the year, amounts for which debit scrolls/paid
cheques or RBI advice has not been received, the unadjusted
amount is transferred as (+) Charge to 0/020/83-‘RBI suspense
unclassified’. On receipt of debit scrolls/ paid cheques or RBI t
advice, 0/020/83 and 0/020/81 are relieved by (-) Charge to 0/020/83
and (-) Receipt to 0/020/81 respectively. With the introduction of
Focal Point Branch System, a new suspense head known as “PSB
suspense” has been opened under code head 0/020/76 to identify the
wanting scrolls and advices relating to Public Sector Banks(PSB).
However the procedure for its booking and clearance remains the same as
applicable to 0/020/83.

Focal
Point Branch Scheme (FPB)

The Focal Point Branch Scheme( FPB) introduced from 1.10.93 is a
revised system of reporting, settlement and reconciliation of
transactions of non-Civil ministries such as Defence, Railways and
Posts. In the earlier procedure, all individual bank branches
were sending scrolls with paid cheques directly to the concerned
Defence Accounting Circle(DAC) leading considerable delay in its
receipt and reconciliation . The revised procedure is intended to make
reconciliation work faster and easier. Under the revised procedure,
each Defence Accounting Circle( DAC) is accredited to one bank branch
functioning as FPB for all SBI branches as well as its Associated
banks, which will be co-located with DAC. The RBI branches will be
acting both as dealing as well Focal Point Branches and forward main
scrolls and DMS to DACs on the prescribed dates. The FPB will be
receiving daily scrolls from dealing branches duly supported by
Cheques/MROs. These FPBs will prepare a main scroll each day in
r/o all scrolls received from all dealing branches as well as their own
scrolls. A copy of the main scroll will be returned to FPB by DAC duly
certifying its correctness/pointing out discrepancies within 24 hrs.
The FPB will be reporting the amount included in the main scroll to the
SBI/GAD link Cell, Nagpur. A Date wise Monthly Statement (DMS) will be
prepared by FPB and sent to DAC by 3rd of the following month, which
will be returned by DAC duly certifying the correctness/pointing out
discrepancies. A copy of the certified DMS will be sent to CGDA by DAC
to reach them by 8th of the following month.

SBI, GAD/ Link Cells RBI branches will intimate the DAC the monthly
settlement account figure put through by them to RBI,CAS Nagpur. RBI,
CAS Nagpur will continue to send monthly closing balance statement to
the DACs by 20th of the following month. Since the Verified Date wise
Monthly statement (VDMS) is the mutually accepted document, it forms
the basic document for reconciliation of Government transactions
handled by FPBs. The FPB Scheme does not cover pension payments made
through Public Sector Banks.